News & Views

17/01/18

Launch of OF Bank fulfills PRRD’s campaign promise

Finance Secretary Carlos Dominguez III said the launch on Thursday (Jan. 18) of the Overseas Filipinos Bank (OFB) through the combined efforts of the Department of Finance (DOF) and the Land Bank of the Philippines (LandBank) fulfills yet another 2016 campaign promise of President Duterte to the Filipino people.

All obstacles to the opening of the bank that will cater to the needs of all overseas-based Filipinos have now been removed following last week’s approval by the Philippine Competition Commission (PCC) of the acquisition by the LandBank Postal Savings Bank (Postbank), which will be converted into this financial institution for overseas Filipinos, Dominguez said.

The OF Bank will be launched on Thursday afternoon at the PostBank Center, Liwasang Bonifacio, Manila.

“It’s just a matter of the administrative integration of the bank. It’s an administrative thing and all the approvals have been cleared away for the acquisition,” Dominguez said.

“You know, we are just fulfilling his (President Duterte’s) campaign promise one by one. First, tax reform, then this new bank,” he added.

Dominguez said that besides fulfilling a campaign promise made during the presidential elections, the conversion of PostalBank into the OFB also saved the former from bankruptcy.

He said the DOF and LandBank are also planning to secure licenses in other countries with large concentrations of overseas Filipinos so the LandBank can provide financial advisory services to the Filipino communities in these areas.

The go-signal given last Jan. 11 by the PCC for LandBank to acquire PostalBank follows the approval last December by the Monetary Board of the acquisition.

In September last year, the President issued Executive Order No. 44 ordering the Philippine Postal Corporation and the Bureau of the Treasury (BTr) to transfer their PostalBank shares to LandBank at zero value.

The EO further stated that the former PostalBank will be converted into the “Overseas Filipino Bank,” which will be a “policy bank dedicated to provide financial products and services tailored to the requirement of overseas Filipinos” and will focus on delivering “quality and efficient foreign remittance services.”

The OFB was previously conceptualized as a bank catering exclusively to the needs of overseas Filipino workers (OFWs) but was later expanded by Dominguez to provide services to all foreign-based Filipinos to make it more inclusive, in keeping with the government’s financial inclusion agenda.

According to Dominguez, the OFB will become a subsidiary of LandBank, “the government-owned and -controlled bank with the most extensive branch network that will cater to the needs of the families of foreign-based Filipinos.”

He said a key feature of the OFB will be its provision of remittance service for OFWs and a loan program for Filipinos planning to return here to start businesses or build their homes.

The LandBank and the BTr are also exploring ways of mobilizing the savings of overseas-based Filipinos for them to invest in the country’s capital markets, Dominguez said.